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Why Allstate (ALL) is a Top Dividend Stock for Your Portfolio
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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Allstate in Focus
Allstate (ALL - Free Report) is headquartered in Northbrook, and is in the Finance sector. The stock has seen a price change of 20.15% since the start of the year. The insurer is currently shelling out a dividend of $0.92 per share, with a dividend yield of 2.19%. This compares to the Insurance - Property and Casualty industry's yield of 0.18% and the S&P 500's yield of 1.61%.
Taking a look at the company's dividend growth, its current annualized dividend of $3.68 is up 3.4% from last year. In the past five-year period, Allstate has increased its dividend 5 times on a year-over-year basis for an average annual increase of 16.11%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Allstate's current payout ratio is 50%, meaning it paid out 50% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for ALL for this fiscal year. The Zacks Consensus Estimate for 2024 is $14.39 per share, representing a year-over-year earnings growth rate of 1,414.74%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, ALL presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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Why Allstate (ALL) is a Top Dividend Stock for Your Portfolio
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Allstate in Focus
Allstate (ALL - Free Report) is headquartered in Northbrook, and is in the Finance sector. The stock has seen a price change of 20.15% since the start of the year. The insurer is currently shelling out a dividend of $0.92 per share, with a dividend yield of 2.19%. This compares to the Insurance - Property and Casualty industry's yield of 0.18% and the S&P 500's yield of 1.61%.
Taking a look at the company's dividend growth, its current annualized dividend of $3.68 is up 3.4% from last year. In the past five-year period, Allstate has increased its dividend 5 times on a year-over-year basis for an average annual increase of 16.11%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Allstate's current payout ratio is 50%, meaning it paid out 50% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for ALL for this fiscal year. The Zacks Consensus Estimate for 2024 is $14.39 per share, representing a year-over-year earnings growth rate of 1,414.74%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, ALL presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).